Euro zone inflation hit its lowest level since November 2009 in March, a shock drop that raises expectations the European Central Bank will take radical action to stop the threat of deflation in the currency bloc. Annual consumer inflation in the 18 countries sharing the euro was 0.5 per cent in March, with the pace of price rises cooling from February's 0.7 per cent reading, the EU's statistics office Eurostat said on Monday.
Economists polled by Reuters had predicted a 0.6 percent reading - itself worrying for an economy that is barely pulling out of a record-long recession after a crisis that nearly broke up the currency area.
The euro zone is far from the deflation that Japan suffered from the early 1990s, when falling prices weakened demand, leading to wage cuts and even lower prices, but the bloc's low inflation rate is a clear sign of economic fragility.
